TRENTON — The man whose commission is expected to devise a fix for New Jersey’s troubled pension and health benefits system says the panel’s members are not affected by politics, disputing critics who say Gov. Chris Christie is using the panel as cover in his effort to slash benefits.

Thomas J. Healy, a former Goldman Sachs executive who once worked for Ronald Reagan’s treasury department, also suggested that the panel may provide recommendations as soon as mid-October, though it could take longer. The commission’s first report, due next month, will be to explain what’s wrong.

“I don’t know yet what the answers are,” Healey, whom Christie appointed to chair the special panel, said in an interview with The Star-Ledger. “It’s a big problem. If we can make that clear, we’ll have accomplished a lot in that first 30 days.”

Healy stressed that the commission is evenly split — three Republicans, three Democrats, and three independents — and that politics won’t be part of its process.

“We’ve got a group of people who are very smart,” he said. “We’re balanced. The two meetings and two conference calls we’ve had so far have been enormously apolitical. Which is the goal.”

The pension fix has enormous political ramifications for Christie. The Republican governor had built his national profile on pension reform, and the troubled system — which faces unfunded liabilities of $40 billion — threatens to cause him more headaches than the George Washington Bridge scandal if he mounts a 2016 presidential campaign.

View full sizeThomas J. Healey is chairman of the special commission Gov. Chris Christi formed to study ways to fix New Jersey's troubled pension and health benefits system for public workers.Courtesy of Gov. Chris Christie's office

After inheriting a pension system that had been neglected since 1997 as governors deferred required contributions when they ran into budget issues, Christie in his first term worked with Democrats to enact big changes. He signed a law that required workers pay more for pensions and health benefits while the state would pump extra cash into the system each year to cut down the fund’s liabilities. It was a triumph that helped raise Christie’s national profile, showing his ability to fix fiscal problems in a bipartisan way.

But Christie cut $2.4 billion in pension payments this year to balance the budget after his administration’s revenue projections badly misfired. Though the move will add $4.2 billion in new liabilities over five years, the governor said there was no other way to make up the money and has repeatedly warned that the pension system will lead New Jersey to bankruptcy if more changes aren’t made.

Christie vowed to introduce a new round of reforms by the end of the summer. But last month, he said he realized the issue was “more difficult and complex” than he expected and created a commission he said “cannot be about politics, it must be about the cold hard facts."

At the front is Healey, a 71-year old Baltimore native who moved to New Jersey in 1968. A registered Republican, he was appointed by President Reagan as assistant secretary of the U.S. Treasury Department in 1983 and served for two years.

Healey said he is distressed how partisan Washington has become, recalling how Democratic U.S. Sen. Bill Bradley visited his confirmation hearing and stressed how proud New Jersey was to have Healey appointed.

“Today, someone from another party would never come and do that,” Healey said.

Healey worked for decades as a partner at investment banking firm Goldman Sachs before retiring 10 years ago. He has since founded an investment firm in Morristown — not far from his home in Harding Township.

“He certainly has a background that’s very impressive,” said Ken Kunzman, a Democratic member of the panel who is an attorney for private-sector laborers unions.

Healy said he suggested forming a commission after Christie invited him to Drumthwacket last month to ask for his expertise on the pension situation.

“That sounds like an easy way to avoid a solution or push off a problem,” Healey said. “But because pension issues are so complicated, and hard for the taxpayer to understand, a commission can serve to lay out facts in a nontechnical way.”

In 2012, Healey co-wrote a policy paper for Harvard University’s John F. Kennedy School of Government that examines ways to drastically cut pension benefits for public employees in the U.S. The co-author was Carl Hess, investment executive and actuary with Towers Watson, who was also named to the commission.

One of the paper’s recommendations was to base pension benefits on the average salary earned by an employee over their entire career. New Jersey bases it on an average of the five highest-salary years. That change, the paper said, would slash pension costs and retiree benefits by 33 percent for a typical pension system.

The paper also suggests moving to a hybrid system that would combine a traditional pension plan with a 401K-styled plan, like Rhode Island has — a change Christie has been considering.

Critics say Healey’s appointment shows it’s clear Christie wants the commission to focus on cutting benefits and not look at ways to raise revenue to fund the system.

Hetty Rosenstein, the New Jersey executive director of the Communication Workers of America, the largest state workers’ union, said the panel has “no credibility.”

“We already know what this commission will say,” Rosenstein said. “I think none of the people who have been hand-picked and selected by the governor should ethically participate in this. It’s a fraud.”

Kevin Roberts, a spokesman for Christie’s office, defended the panel.

“The entire commission, Tom Healey included, is a group of extraordinarily well-respected and accomplished professionals who are free from politics,” Roberts said. “Tom’s only charge is to take a cold hard look at the facts and he has helped call on some of the foremost experts on these matters to do just that.”

Ginger Gold Schnitzer, a spokesman for the New Jersey Education Association, the influential state teachers union, said the state doesn’t “need a commission to know what the problem is. The state has to pay their fair share. I feel the governor is wasting the commission’s time.”

Democratic lawmakers have stressed that Christie broke his promise — and legal requirement — to fund the pension system. The governor rejected Democrats’ plans to find the money by raising taxes on millionaires and businesses, saying he won’t hike taxes to fund “entitlement” retirement and benefit plans.

The CWA and about a dozen other public-worker unions have sued the governor to stop him from cutting pension payments. A final court decision is pending.

Experts say it may be difficult for Christie to slash current pension contributions because they are, in some cases, protected by the state constitution. They said it may be easier to reduce health benefits, which aren’t as strongly protected. The governor could also increase pension contributions for future workers and raise the retirement age again, which he did in 2011.

Healey said it’s too soon to tell if the commission will suggest focusing on health benefits but said members are looking at a recent report on the subject by JP Morgan. “They see the combined pension and health liabilities of New Jersey as among the worst in the country,” he said of the report.

Any changes ultimately suggested by Christie will have to be approved by Democratic-controlled state Legislature, which might be a difficult prospect. Assembly Speaker Vincent Prieto said he’s holding out judgment until he sees the commission’s report. “I will take anything presented to us under review,” Prieto said. “This is something we have to get our hands around.”